Archive for the ‘Life Sciences’ Category

On January 10, 2018, an internal Department of Justice memorandum (the “Granston Memo”) was leaked to the public, turning heads. The Granston Memo included an in-depth analysis of the DOJ’s position on evaluating dismissals pursuant to the False Claims Act (FCA). The Granston memo outlined the DOJ’s position on FCA claims brought by whistleblowers. Under the FCA, a whistleblower may bring what is known as a “qui tam” action on behalf of the government, which potentially allows said whistleblower to receive a share of any government recovery. The Granston memo is particularly significant, as it provides those faced with claims of False Claims Act violations with insight into the DOJ’s stance on a range of factors for dismissing these qui tam actions.

Under the FCA, the Attorney General can dismiss a whistleblower’s qui tam action, so long as the whistleblower is given the opportunity to be heard. 31 U.S.C. § 3730(c)(2)(A). Despite this provision, the DOJ noted that this dismissal option has not been actively utilized by the DOJ. The Granston Memo specifically addresses seven enumerated circumstances where the DOJ should be considering moving to dismiss these qui tam actions:

Of course, the factors above are not mutually exclusive or exhaustive. The DOJ could move to dismiss these actions for multiple or other reasons.

The Granston Memo also sheds light on the increased number of whistleblower filings per year, which appears to have triggered this concern by the DOJ of the underutilized dismissal provision of the FCA. Indeed, the Granston memo mentions the possible negative consequences of the Government’s failure to use the dismissal provision, including generating adverse decisions which affect the government’s ability to enforce the FCA.

Companies or persons facing FCA claims should be particularly aware of the Granston memo, and should argue to the DOJ and/or to the whistleblower themselves that any such claim is subject to dismissal based on the seven factors above. In some circumstances where the government has decided not to intervene, the whistleblower can obtain permission and voluntarily dismiss a qui tam action.

A panel of the Eleventh Circuit determined in a February 8, 2018 published decision that a Florida district court erred when it ruled that a husband’s claims, brought against a medical device manufacturer after its Life Vest defibrillator failed to shock his wife’s heart, were preempted by federal law.

A defibrillator is worn by patients at risk of sudden cardiac arrest. It delivers a dose of electric current to the heart, depolarizing the heart muscle and ending dysrhythmia. The lower court dismissed the action in January 2017, ruling that the claims against the manufacturer were preempted by the Medical Device Amendment of the Food, Drug and Cosmetic Act. The FDA previously determined the Life Vest device was safe, and the district court agreed with the manufacturer that the allegations improperly contradicted the FDA’s prior approval of the product.

The Eleventh Circuit disagreed with the lower court’s ruling, deciding that the claims were not preempted. The court reasoned that the strict liability and negligence claims were not preempted by the federal regulations because the plaintiff alleged the defect was due to the manufacturer’s purported failure to comply with these regulations—which then caused a violation of Florida’s laws. The Court considered that a 2014 FDA warning letter put the manufacturer on notice that it was in violation of certain regulations. That letter can, now, serve as a basis for the plaintiff’s claims—even though the letter referred to shocks being delivered to patients who did not need them, as opposed to the failure to deliver shock to patients who needed them (as allegedly experienced by the plaintiff’s wife). The Court determined that the complaint’s references to the letter sufficiently stated a claim that was plausible on its face despite this disconnect between the warning letter and facts relating to the plaintiff’s wife’s use of the product.

Medical device manufacturers should be aware of the Eleventh Circuit’s ruling that claims of strict liability and negligence may not be preempted by the Medical Device Amendment. Such manufacturers should be particularly cognizant of this Eleventh Circuit decision where they have received an FDA warning letter.

From operating rooms to a local pediatrician office; we know that medical devices have altered the medical field in a significant way. As technology, has improved; making our homes smarter and allowing our cars to essentially drive themselves; medical devices have seen great technological advances. Now devices can communicate with each other and exchange information even if they are from different manufacturers. Interoperable medical devices are defined in section 201(h) of the Federal Food, Drug, and Cosmetic Act (FD&C Act) as devices that can exchange and use information through an electronic interface with another medical/nonmedical product, system, or device. Interoperability is essentially the means in which medical devices communicate and interact with each other. Yet, errors such as inconsistent units of measurement between the devices prompted the FDA to step in with guidance for the manufacturers.

The FDA issued its final guidance and recommendations on interoperability to ensure the safety and reliability of the communication between medical devices. The 21- page document, released on September 6, 2017, focuses on considerations that ought to be involved in the advancement and overall design. There were also suggestions for the material to be included in premarket submissions and labeling of devices. The guidance directly highlights that interoperability should be an objective for manufacturers; verification, validation and risk management activities should be taken; and manufacturers should be specifying the relevant features in a user- friendly way.

The FDA opines that manufacturers should perform a risk analysis and perform testing that considers; the perils that could be linked to interoperability, who the users of the devices may be, misuses that would be reasonably foreseeable, and a combination of foreseeable events that could result in an overall dangerous situation. The FDA advises that manufacturers should keep in mind the diverse users while designing the device and in formulating the instructions; since such considerations may affect the limitations on the device or the user. The FDA even suggests developing entirely different instructions for different users. The guidance document states that interoperable systems should sustain basic safety and key performance during normal and fault conditions. The manufacturers should be designing an interoperable medical device that can appropriately allay risks connected with a wide range of potential error scenarios. The guidance document also suggests that the devices endure a sufficient level of testing to prove that the interactions on the electronic interface are performing in the appropriate manner. The testing ought to be based on the purpose of the interface and should comply with the planned specification. Another general takeaway from the guidance document is that difficulties or misapplication of the devices can be curtailed by making the functional, performance, and interface standards readily available to all users.

Simply put, the goal is to make sure these devices are communicating in a way that ensures the safety of the patient and the operator of the devices. Manufacturers who are submitting applications up to 60 days after the publication of the guidance will not be required to comply with the recommendations. Yet, the agency is willing to review any information submitted to them regarding interoperability. The guidance document is not legally binding, but it highlights the impact of technological advancements on medical devices and the safeguards that should be in play. And as we read the guidance document on our latest smartphone or tablet, we are reminded of the tremendous impact technology has on our lives and continues to have.

The U.S. Supreme Court decided one of the most important mass tort/product liability decisions ever Monday, effectively ending forum shopping or “litigation tourism.” In its 8-1 ruling, the Supreme Court in Bristol-Myers Squibb Co. v. Superior Court, No. 16-466 (U.S. June 19, 2017) overturned a California Supreme Court decision that had allowed hundreds of out-of-state patients who took Bristol-Myers Squibb’s blood-thinning medication Plavix to sue the company in California.

For years, plaintiffs involved in “litigation tourism” have relied on broad interpretations of personal jurisdiction to sue large companies in plaintiff-friendly jurisdictions. Ever since “general” personal jurisdiction was limited by the Supreme Court three years ago in Daimler AG v. Bauman, 134 S.Ct. 746 (2014) to those states where a corporation is incorporated or has its principal place of business, plaintiffs have tried to use a similar broad interpretation of “specific” personal jurisdiction to forum shop. The California Supreme Court accepted this theory when it allowed plaintiffs from all over the country to sue Bristol-Myers Squibb in California.

But the Supreme Court didn’t buy it and reiterated that the lawsuit itself must arise out of or relate to the defendant’s contacts with the forum.

The Supreme Court rejected the California Supreme Court’s ruling that any “substantial connection” between a corporate defendant’s activities and California, whether or not causally related to a plaintiff’s claimed injuries, would suffice to support jurisdiction. The California Supreme Court conferred jurisdiction over Bristol Myers-Squibb where the plaintiffs did not reside in the state and did not sue over a drug that they purchased in the state. The Supreme Court called this approach a “loose and spurious” form of general jurisdiction.

As the Court held, “a defendant’s general connections with the forum are not enough.” This means that plaintiffs may “join together in a consolidated action in the States that have general jurisdiction over BMS.” Otherwise, “the plaintiffs who are residents of a particular State… could probably sue together in their home States.”

This ruling ends the days of plaintiffs flocking to accommodating jurisdictions to bring claims against large companies, and it is already having widespread effects. Based on the Court’s ruling on Monday, a St. Louis judge declared a mistrial in a talcum powder trial underway in St. Louis Circuit Court based on lack of personal jurisdiction. The mistrial in St. Louis was declared in a trial where a Missouri man and two out-of-state plaintiffs sued Johnson & Johnson and its supplier Imerys Talc America over a claim that talcum powder in its products caused ovarian cancer. Johnson & Johnson’s lawyers prevailed, arguing that the packaging and labeling company with a plant in Missouri was simply one of the company’s contractors, and played no role in establishing jurisdiction over out of state plaintiffs.

In July of 2007, Joshua Martin suffered a brutal gang attack outside of Six Flags Over Georgia and was left with severe brain damage. On June 5, 2017, the Supreme Court of Georgia granted certiorari to decide the following two questions: “(1) whether Six Flags could properly be held liable for the injuries inflicted in this attack; and (2) assuming liability was proper, whether the trial court’s apportionment error does indeed require a full retrial.” The Supreme Court reinstated a $35 million verdict for Mr. Martin, holding that the jury was authorized to find Six Flags liable for the breach of its duty to exercise ordinary care in keeping its premises safe for invitees. The Court then remanded the case to the trial court for a determination as to apportionment of fault.

The jury had apportioned fault between the parties by assigning 92% of the $35 million verdict against Six Flags, and 2% against four of Martin’s attackers. Six flags argued that the jury should be entitled to apportion damages among not only named defendants, but also among individuals who were alleged to have been involved in Martin’s attack. Georgia law provides that, when assessing percentages of fault, the trier of fact shall consider the fault of all persons or entities who contributed to the alleged injury or damages, regardless of whether the person or entity was, or could have been, named as a party to the suit. OCGA § 51-12-33.

The Georgia Supreme Court acknowledged that two of Mr. Martin’s assailants should be added to the verdict form, and decided that apportionment could be decided without a full retrial. “[A]s a general matter, where correction of an apportionment error involves only the identification of tortfeasors and assessment of relative shares of fault among them, there is no sound reason to disturb the jury’s findings on liability or its calculation of damages sustained by the plaintiff.” The Court did, however, concede that a retrial on apportionment might require the presentation of much or all of the same evidence as was presented when determining liability.

To be sure that fault is properly apportioned, Georgia attorneys must include on the jury verdict form all individuals, including the plaintiff, who contributed to the injury or damages.¹